New Leader, New Strategy -- New Hope in Baghdad

The new U.S. commander in Iraq, Gen. David Petraeus, gives a rare interview to ABC News' Terry McCarthy. Below is an unedited, excerpted transcript of the interview:

McCarthy: You've been here for just about a month now, initial signs seem to be encouraging. Are you -- with what you're seeing in the first early days of this new strategy?

Petraeus: Well the plan's unfolding on schedule, there are few mildly encouraging indicators in baghdad although they sort of go up and down, so you have to hold off on that. But there are quite encouraging indicators in anbar province and then there are some in other areas that are warnings to us that we've got to pay closer attention, for example in diyala province, some of the fault line areas, the sectarian fault lines, we've got to keep a very close eye on.

McCarthy: But Sadr City — who could have imagined American troops could march in to Sadr City and meet almost no resistence?

Petraeus: Well that was a pleasant surprise and it was one that was essentially brokered by the prime minister, by the government of iraq and also by our leaders and Iraqi security force leaders. It was helped by the fact that the numebr of the more extremist leaders of Sadr's milita have left baghdad and in some cases left iraq altogether but it's also been surprising too … the other day, I walked through the City of heet in the euphrates river valley and had on a soft cap and ate an ice cream cone, and that was soemwhat surprising as well. …

McCarthy: No armor in Anbar?

Petraeus: Well, I did have body armor on, I just didn't have a cap on. But it's a start.

McCarthy: As you know of course, this is not just a military issue, it's a political issue both in iraq and domestically. On the domestic front, joint chiefs have indicated they want troops to draw down maybe by the fall -- your commanders on the ground, from general Odierno down say they want to stay longer -- how do you bridge that gap between washington politics and the reality on the ground?

Petraeus: I don't think you do, I think that's not my job. The job of a commander of a force in a situation like this is to understand the mission that the force he's privileged to command has, to make sure he's in line with his boss on that mission, to request the forces that are needed to perform the mission, and then to do the best we can with what we get and if we don't get what we have asked for, to be sure that those above us know the risk that is incurred as a result of that. So we truly are trying to stay out of that…obviously we're aware of the environment in which this is taking place, we're aware that there is a washington clock and then there's a baghdad clock but you need to sort of shut that out to a degree as a commander and to tell them what you need and do the best you can with what you get.

McCarthy: The talk in Washington is that Labor Day is not a deadline to succeed here but labor day is a time to judge how progress is going. In september of this year, you said that you would go back to the American people, both to congress and the American people and give a report card of how things are going. What would be your optimal level of achievements here this year?